Feds sue ITT Educational over loan practices

12:35 PM,
Feb. 27, 2014

ITT Educational Services Inc. is being sued by the U.S. Consumer Financial Protection Bureau, which accuses it of encouraging students to take out loans that the company knew they would have to struggle to repay. A spokesman for ITT said the bureau's claims 'are without merit.' This is a photo of the company's headquarters at 13000 N. Meridian St. in Carmel.

Written by

Christie Smythe
Bloomberg News

ITT Educational Services Inc. was sued by the U.S. Consumer Financial Protection Bureau over claims the for-profit college chain engaged in predatory lending by encouraging students to take loans they would struggle to repay.

ITT misled students by overstating their job prospects and potential salaries and then pushed them into high-cost private loans that were likely to end in default, Richard Cordray, the agency's director, said Wednesday after the agency filed a lawsuit in federal court in Indianapolis.

"Corporations that own these colleges often seem to care more about dollar ...